How Business Owners Can Stay on Track Financially (Even With Irregular Income)

If you’ve ever felt like your finances are a rollercoaster — one month flush with cash, the next month scraping by — you’re not alone. For many entrepreneurs, income doesn’t arrive like a steady paycheck. Some months are booming, others are quiet.

This variability makes it tough to set savings targets and stay on track toward long-term financial goals like retirement or building wealth.

If you’re in your 30s or 40s with irregular income, here are a few practical steps we recommend to clients to help smooth out the bumps and keep making progress.

Build a Bigger Buffer

For employees, a 3–6 month emergency fund might be enough. But business owners often need more cushion. Some aim for 6–12 months of expenses set aside in a high-yield savings account or money market fund. Others prefer a flat dollar target — say, $100,000 in cash — to weather a slow season.

Tip: Separate your business buffer (operating expenses) from your personal buffer (living costs). We often see entrepreneurs blend them together, which only creates messy finances and makes it harder to stay organized. Yes, it means managing two budgets — but that’s part of choosing business ownership.

Automate Smartly, Stay Flexible (Even With Irregular Income)

• Set a baseline transfer: Choose a modest, sustainable amount you can save even in lean months. This ensures you’re always making progress, no matter what.

• Add surge contributions: During high-income periods, funnel extra into retirement accounts, investment portfolios, or debt payoff.

Some clients set surge contributions as a percentage (20% is common). Others use thresholds, like: “Once my bank balance hits $150k, I’ll move $50k into investments.”

There’s no single “right” strategy. What matters is finding a system you’ll actually use — and then measuring if it’s working.

Measure Success With a Pass/Fail System

For clients with steady paychecks, it’s easy to track exact savings rates. For business owners, we look back at the prior 12 months and give a simple Pass or Fail.

Example: After filing his taxes, our client Joe reported $200,000 of income in 2024. Here’s where it went:

• Maxed out his retirement plan at $16,500

• Maxed out an HSA at $8,300

• Bought a rental property with a $60,000 down payment

  
  

In total, Joe saved over $80,000 — more than 40% of his income. That’s a huge success. Celebrate it!

Now consider a down year. Suppose Joe only managed to max out the HSA at $8,300. That’s just 4% of income — a Fail. But that’s okay. As long as he passes most years, he’ll stay on track to hit his goals.

The key is not to ignore the Fail years. Acknowledge them, uncover the reasons, make a plan to fix them, and then move on. Don’t dwell — just reset and keep going.

The Bottom Line

Unpredictable income doesn’t mean unpredictable wealth. In fact, business owners need saving systems even more than employees.

By building a larger cash buffer, automating what you can, and tying your financial plan to your business cycles, you’ll keep moving forward — no matter how bumpy the ride gets.